Heritage Global (HGBL) 17th Annual LD Micro Main Event Conference summary

Business overview and structure

• Operates in valuation, disposition, lending, refurb, and resale, split into industrial and financial asset groups.

• Industrial assets focus on machinery and equipment auctions, with a legacy dating back to the Great Depression.

• Evolved from regional bankruptcy auctions to national/international asset management, serving major clients in pharma and other sectors.

• Valuation business is growing due to increased plant closures and a shift from venture to traditional lending.

• ALT acquisition enabled expansion into refurbishing and reselling used equipment, aligning with environmental trends.

Financial asset division and market trends

• NLEX, a 25-year-old brokerage, specializes in non-performing loans and has never had a losing quarter.

• Growth driven by fintech, buy now/pay later, and rising consumer defaults post-pandemic.

• U.S. credit card debt at $1 trillion, with record defaults and increased non-performing loan supply.

• NLEX operates as a broker, not a lender, maintaining profitability through volume and controlled costs.

• Anticipates significant growth in non-performing loan brokerage over the next 2–3 years.

Growth strategy and financial position

• Projects $10 million net operating income and $12 million EBITDA for the year, with a $70 million market cap.

• Zero bank debt, $15 million cash, and a $10 million+ credit line support M&A and buyback initiatives.

• Buyback program expanded to $6 million, with $4 million still available for repurchases.

• Focused on international and sector expansion in industrial assets, and diversification in financial assets.

• Targets bolt-on acquisitions in Europe and Canada, and small specialty dealers in various asset classes.